Home Sales Wane During Lunar New Year

A real estate office in Huaian, Jiangsu province, is seen on Sept. 17. In 21 surveyed Chinese cities, the average number of property sales in February plunged 38.2% from January. Photo: VCG

Home sales in 21 major cities surveyed fell 28.6% year-on-year in February as the Lunar New Year holiday threw cold water on property transactions across the country, state media reported.

On a monthly basis, the average number of sales plunged 38.2% from January in 21 surveyed cities, according to the official Economic Information Daily, which cited data released Monday by the China Index Academy, a property research firm.

The drop in transactions was more pronounced in first-tier cities than in second-tier cities.

Homes sales in the surveyed first-tier cities plummeted 54.7% month-on-month and 51.3% from a year earlier, while home sales in the second-tier cities fell 30.7% from January and 24.5% from a year before.

One expert blamed the lethargic market on the annual seven-day national holiday, commonly called the Spring Festival. “During the Spring Festival, the property market enters the off-season, so demand was weak,” said Hu Jingjun, vice-president of B.A. Consulting and 5i5j Group, the market research arm of realty company 5i5j.

In first-tier cities, transactions in Shanghai and Guangzhou each dropped more than 50% year-on-year in February. More than 90% of second- and third-tier cities monitored by China Index Academy saw the number of home sales fall. Transactions in Wuhan, capital of Central China’s Hubei province, fell 60% from the previous year, faster than in any other second-tier or third-tier city.

Analysts from China Index Academy said the government will not relax restrictions on real estate purchases early this year, and city governments are likely to adopt their own tailored policies to defuse the risks in the real estate market, the Economic Information Daily reported.